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(Part 2) - Accessible Sustainable Ecotourism:
Necessary Market Adjustments in a New Age of Travel

By: Anthony Chamy - ecotoursonline.ca - Page 1 | Page 2

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Globalization and the Paradox of ecotourism

Globalization has become a driving force to many industries in today’s world. Tourism being one of the fastest growing industries has benefited from it. This has therefore allowed for many developing countries to embrace the integration of culture, technology, politics, and economics as a part of their strategy in attracting tourists to these countries. It is essential to understand that both tourism and globalization feed off each other. In other words, as much as tourism needs globalization to grow as an industry, it is due to tourism that globalization has become such an important aspect of interaction across geographic spaces. Tourism was the forerunner of the globalization system. It is with tourism that people were brought together from distinct parts of the world and it is thanks to tourism that the exchange of cultures, economics, and information has been created.

The globalization system bridges political, social, economic and geographic divides. It is the lynch pin that encourages growth in tourist activities across such divides. Through globalization, communication has become much more easily accessible between people.
Globalization is itself driven by faster and easier access to information, which in turn drives tourism as an industry.

Because information is easily accessible to consumers via the World Wide Web, they approach traveling with a much more concrete idea of what it is they hope to gain from the experience. Hence, the tourism industry must continually strive to keep abreast of changes in a consumer’s knowledge about different cultures in the world, and also strive to offer innovative approaches to touring the world.

There exists a paradox within a destination that relies on tourism as a main industry for the country’s economy: a tourist destroys what he is searching for, while he discovers it.
As Dr. Sheryl Elliot, professor at the George Washington University’s School of Tourism Administration has noted, “Finding the right balance is the key for tourism as it is for the overall globalization system”. Being able to see tourism through multiple lenses (financial, political, social, environmental, and technical) helps in accomplishing this goal”.

The main challenge that the tourism industry faces is to sustain economic growth while ensuring the long-term protection of the social and natural environment. Developing countries rely on tourism as a primary source of foreign currency, income, and job employment making it indispensable to the economy of the country. Therefore some developing countries depend on mass tourism to support their economy. However, these countries might fall into the trap of completely tailoring themselves in order to maximize the short-term opportunities that tourists can bring, sacrificing the long-term natural environment of their area. Thus, if not well managed, touristic attractions can quickly disintegrate into generic commercialized mass tourism sites that lose their appeal and eventually become unpopular.

Ecotourism is a solution to this challenge. It allows for tourist activities to take place, while keeping in mind ways to overcome the negative impacts of mass tourism. It is by being able to break down all aspects of globalization and their effects on tourism that the industry will be able to balance the pro’s and con’s of the market’s evolution and ensure sustainable development of the popular destinations.

The good news is that globalization channels significant information to every potential traveler on today’s environmental threats such as global warming and oil spills making more and more people look for alternative and sustainable travel solutions.

Current Market inefficiencies:

There exist current market inefficiencies that greatly affect the development of ecotourism. The following are the main challenges that companies in the tourism industry will have to overcome in order to follow the new wave of ecotourism:

- The value chain structure was organized in the tourism boom of the 60’s and 70’s, making it out of date today:

Figure 1: Current Tourism Value Chain (Luck, 2003)

- In current tourism value chains, large corporations on both the client’s and the supplier’s ends monopolize on mass tourism movements. Unfortunately, these large tourism firms are stuck in their mass tourism economical logic and switching to ecotourism and nature travel is still very difficult for them.

However, with today’s technology, it is possible for travel agents to access many facets of the country’s local services directly through the Internet, even in some of the world’s most remote areas. In many cases, the middlemen are completely unnecessary, but exist due to traditional practices.

With globalization you can be vertically integrated multinational and manage all aspects of the value chain, without the need for being a huge enterprise.

- Even government laws currently in place are there to better manage a tourism industry, 35 years ago! For example, in Quebec, there are laws stipulating how anyone involved in the organization of a tourism activity, no matter what its nature, must own a travel agent’s permit. This is supposedly to protect the traditional client traveling with the traditional travel agent. However with the internet, it is possible for someone to organize almost, it not all facets of a group trip, without any previous experience. Thus the law protects the current travel agents by forcing clients to travel through them, yet slows down the new millennium’s independent travelers that might want to advise their friends and family.

- Coordination between government and private companies is a huge opportunity for developing countries to put ecotourism in the spotlight of their economic revival. However, the vast majority of governments are plans that incongruent with the direction the private sector is taking, minimizing each party’s efforts. The governing bodies of developing countries with a relatively high % of their GDP coming from tourism need to put serious thought to finding a way of implementation their regulations and lining up the private sector with their long-term plans.

- “Many participants and speakers strongly criticized the lack of clear objectives and guidelines for ecotourism projects and programs at the national level. This leads to conflicts between the preservation and development objectives” (World Tourism Organization, 2002) This brings about another inefficiency, that of self-diluting multiple direction within the government itself (between the ministries, or between the regions). Without a solution for this, countries will not be able to build upon a national plan that would otherwise bring many benefits, both social, natural and economic.

- The local infrastructure in many countries is unacceptable for the amount of tourists that visit it. The local taxes aren’t enough for financing and rebuilding all the roads, public parks, etc…

- The concept of "compact tourism destinations" presented at the seminar can reduce environmental pollution and costs of infrastructure per capita, at the same time providing a better critical mass of potential clients for tourism facilities and public transport schemes. It makes the development of a tourism sector feasible, and allows the development of local infrastructure for the benefit of tourists and local communities. Focusing on a smaller number of products, and concentrating tourism in the appropriate regions, may be the best strategy for developing a strong ecotourism sector, while at the same time implementing sustainable tourism principles.

- Very often, small ecotourism projects only target foreign tourists, making the initial investment to attract these crowds more important. However, this also makes it more difficult for these projects to become viable, since with some domestic tourism to boost the project, it will minimize the risk of failure. “Encouraging and stimulating domestic tourism is a key factor to developing financially feasible and locally beneficial eco-tourism.”

- There is a general lack of analysis and research with respect to the opportunities that the ecotourism market represents. Ecotourism needs proper scientific support Policies and programs should be based on studies and expertise carried out by the research departments of the local universities.

As for inefficiencies that occur within large corporations, four major ones can be identified. Internally, large corporations are structured for the traditional mass tourism market, and have grown into multinational conglomerates with rigid structures. With the new market trends pushing for an ecotouristic approach, these rigid structures will be destroyed or take many years to be dismantled and reorganized.

(1) An established company’s culture can hinder it’s adaptation to a new market trend such as ecotourism, since it will have to break its mold before being able to create a new one. The will not to break tradition can sometimes be stronger than the will to adapt, as would dictate a 60-year-old CEO who built his company in the day when tourists’ values were different.

(2) The financial structure of a large corporation pushes short-term profits, and thus makes it very difficult to focus on the potential new markets available for the taking, if these involve slowing down the profit growth rate. Looking at the shareholders objectives, or even just the sales staff and their objectives, propositions for short term sacrifice in order to gain in the long-term would be hard to swallow.

(3) Furthermore, many large corporations have made long-term investments in assets orientation towards generic mass tourism, and have years to come before seeing the return on that initial investment. It is hard for such a firm to consider concentrating their efforts in directions other than where they have already initiated their investments.

(4) Lastly, large enterprises would need more time than a small or medium company to adjust themselves to new market trends. It will be only those that have a true visionary strategic department that will be able to understand that the time spent training and the losses spent during the adjustment period are worth the eventual outcome.

Opportunities for ecological emerging enterprises

As previously discussed, travelers’ needs are changing and demand for sustainable and environmental friendly travel solutions is greatly increasing. The value-creating attributes that travel enterprises should incorporate in their products are no longer the same. These new attributes mentioned earlier in this paper create a revolutionary economic structure in tourism that large and established firms will have much trouble exploiting. Also previously mentioned is that current industry structure and current organizational structures are no longer economical and no longer fit the environmental logic invading the industry.

Ecotourism is an innovative way of traveling and discovering other countries that makes more sense at the time being for smaller players. Larger and established players are stuck with their rigid organizational structures and will never allocate resources to serious ecotourism projects until the market is large and profitable enough. In other words, large organization such as Tomas Cook and TUI will wait until a profitable infrastructure is in place. While most countries still struggle to find a solution for such an infrastructure that balances economy and ecology, a few countries such as Costa Rica and Kenya are showing positive change.

The inevitable path large tourism companies will follow is the opportunity for innovative start-ups to successfully launch their new products, grow the ecotourism market, and leapfrog their established rivals.

It is very rewarding in our case to make an analogy between ecotourism and a technological innovation. Innovations incessantly revolutionize the economic structure from within, destroying the old one and creating a new one. This process of Creative Destruction described by economist Schumpeter decades ago is an essential fact about capitalism that is taking place in today’s tourism industry (Schumpeter, 1911).

Innovations are product life cycles (S-curves) where the product matures to a dominant design followed by accelerated improvement (Teece, 1987). In this creative and dynamic model for understanding change, the old incumbents (established tourism firms) are replaced by new entry firms and their core competencies become core rigidities.

In Christensen’s Disruptive Innovation concept, large established firms try to push new technologies or concepts in their current product lines instead of creating new products from scratch (Christensen, 1997). This has proved to be fatal in the case of radical-like innovations because every single function in the firm is aligned on the old product architecture. It is the same in the case of travel products. New attributes in the new technology or ecotourism concept that the emerging niche market needs could not satisfy clients in the mainstream markets if pushed in current travel products.

Firms should look for creative applications to develop and commercialize their new technologies instead of using old ones. New applications where new customers are willing to sacrifice some mainstream functions in exchange for new ones are only possible with the new technology. To clarify this approach, consider new applications as simply new travel needs in an emerging ecotourism niche market. Mainstream functions that these emerging niche markets are willing to sacrifice are for example the hair dryer, the TV, the daily plastic wrapped soaps and the restaurant’s imported French cook. In ecotourism markets, all these functionalities have no added value and sometimes even reduce the value perceived by the client. It may sound awkward but more and more travelers are willing to pay more for not having a TV or a hair dryer in their hotel room.

Considering new ecotourism travel solutions as disruptive innovations is a very strong tool for small start-ups to base their strategy and business plans on.

CONCLUSION

Information and communication technologies, the Internet, travel guides and other information-diffusing media are bringing about great knowledge that is significantly stimulating our thirst for world discovery.

Tourism is about balancing the unknown with the known. While people travel to search for what they lack in their own environments, they also travel to find what they already know and could relate to. When gigabytes of images and texts on beautiful natural and social environments pass through our screens every day, we become knowledgeable and our fear of traveling to the unknown disappears. We no longer need elements from our physical home to feel comfortable when elements from our virtual home are naturally available. This fundamentally explains the accelerated ecotourism market and the new opportunities for new entry local firms.

This paper has only scratched the surface of how an innovation model can be developed for finding clear solutions in the tourism industry, specifically through ecotourism. This model will help us better understand the tourism trends and constitutes a base on which emerging enterprises will develop their strategies.

 

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